- Industry: Energy & Utilities
High bill causes and trends
As water infrastructure ages and water costs increase nationwide, high-bill allegations have reached unprecedented levels. Common causes of high bill allegations include:
- Leaks: Customers may be unaware of leaks and utilities oftentimes lack the insight or fail to proactively notify customers
- Rate transparency and understanding: Customers are unaware, or do not understand the impacts of rate design and changes in volumetric increases vs. fixed service fees
- Manual meter misreads: Manual readings are susceptible to error and falsification
- Software issues: Poor quality controls in meter reading software and customer information systems do not always flag high bills for review
- Consumption behavior changes: With more extreme weather events (e.g. droughts), customers often are unaware of how their behavior changes related to water use
- Replacing aged meters: When aged, slow-registering meters are replaced with new accurate meters, customers notice an increase in consumption
As these issues compound, exacerbated by limitations in utility data quality and reporting, high-bill complaints can create complex public relations and legal issues.
Mitigating high bills
Considering the various causations of high-water bills, utilities are pursuing a variety of high bill mitigation strategies by:
- Refining operational controls that hold staff accountable and catch errors in billing processes before inaccuracies reach the customer
- Deploying real time, two-way meter communication via advanced metering infrastructure (AMI) w Developing software configurations that detect anomalies to alert customers of potential leaks and empower the utility to address operational abnormalities
- Building new or enhanced customer experience and engagement programs to increase communication for key issues
Focusing on different aspects of high bill related issues, no singular mitigation strategy is all-encompassing. Multicausal billing issues call for a unique blend of solutions. To understand the mitigation strategy that best fulfills the issues and needs of your utility, it is important to first identify the root cause of billing and service issues.
To determine if high bill allegations are valid, West Monroe reviews aggregate consumption data, key utility operations, and account history where high bills are alleged. The full micro and macro analysis includes reviewing consumption trends going back up to ten years, normalizing against weather patterns and conservation restrictions, identifying the frequency of outliers throughout the analysis, and comparing outliers by unique variables (meter type, geographic area, bill cycle, etc.).
From an operations perspective, West Monroe performs a detailed review of across the utility’s processes and systems, including:
- Meter reading, testing, and maintenance
- Billing and collections
- Field service and investigations
- Call center and customer service
As customer scrutiny and high bill allegations persist, what is your utility doing to mitigate these issues?
Examples of high bill complaints across the country
- Following an AMI pilot, a southwestern municipal water utility received numerous, highly-public complaints of high bills. The utility analyzed over 10.3M meter reads to understand aggregate water consumption trends and demonstrate that most of the high bill allegations were unsubstantiated. Using data from the analysis, observations, interviews, and comparisons to peer utilities, West Monroe helped this utility develop a roadmap to mitigate the risk of future high bills, improve operational efficiency, and restore customer confidence.
- Following the implementation of a new conservation rate billing system, a northeastern municipality experienced an uptick in high bill complaints, leading to investigation by the Department of Public Service (DPS). The utility reached an agreement with DPS to contribute up to $5M in rate relief, a conservation rebate program, and other customer benefits.
- Across four highly public suits, a southern municipality was criticized for high billing and improper water charges. After new, tiered water rates were introduced throughout 2015 and 2016, the plaintiffs alleged that the city was incorrectly calculating monthly bills. Over a year later, an additional lawsuit was filed claiming that the city charged commercial customers fees unrelated to water consumption.
- A woman was given a water bill of $25,000 after a midwestern municipality failed to shut off the water in her deceased mother’s house. This was the second such highly publicized case in the past 6 months and signaled the need for increased attention to local water utilities’ billing and operational processes.
- A customer’s unusually high-water bills in a southwestern county significantly diminished when his water meter was replaced, following fruitless leak detection efforts by both the agency and a contracted plumber. He is now suing the public utility agency for compensation for his historical high bills